Victoria's best state budget coverage is here from 3.30pm. All the news that affects you - transport, schools, hospitals, cost of living. With expert analysis from state political editor Josh Gordon, national economics editor Peter Martin and senior business analyst Malcolm Maiden.
A multibillion-dollar rail tunnel from Southern Cross Station to South Yarra will be the biggest item in this year’s Victorian budget.
The Metro Rail Capacity Project, formerly called the Melbourne Metro, will run via St Kilda Road and Fishermans Bend.
This is a radical departure from the original plan, in which the tunnel was to have run beneath Swanston Street with five new stations including at Parkville and North Melbourne.
Work will start in 2016, News Limited has reported. A Napthine government spokeswoman labelled the report “speculation”, although Premier Denis Napthine has hinted heavily in the past that the original plans for Melbourne Metro had been torn up for a new route.
Chris Hale, a University of Melbourne transport expert, described the Napthine government’s new proposed alignment as a “disaster”, and accused the government of scrapping the original plans without consultation, either with the public or planning bodies such as Infrastructure Australia.
“They’re spending billions of dollars as an election stunt,” he said. “What we need for Melbourne is close to the original concept, especially a station at Parkville, which is an important employment destination with hospitals and the university that has had so much investment put into it over the years.”
Dr Hale said Parkville was a key part of Melbourne’s knowledge economy and needed a rail connection so people from all over Melbourne could travel there.
“They’re emphasising Fishermans Bend, but it’s 10 or 15 years away. It’ll have a railway station and nothing else,” he said.
“There are so many places in Melbourne that are already intensively developed and have a desperate need for transport connectivity and they’re being dismissed for a non-existent location.”
Public Transport Minister Terry Mulder told Fairfax Media last year that the Napthine government was “nowhere near ready to start construction” on the project.
'”We've got $49.5 million to take the project forward, but it would be a project that would be on the drawing board for us towards the end of this decade,'' Mr Mulder said in September.
A 2012 report on Melbourne Metro, by SGS Economics and Planning, said the tunnel and its five stations would boost the Victorian economy by about $65 billion by 2046, by improving travel times, reshaping employment opportunities and mitigating disadvantage in Melbourne's west by giving people more access to work.
Treasurer Michael O'Brien refused to comment on any pending Metro Rail Capacity Project announcement.
"We'll have more to say about all of our budget announcements in the lock-up."
He said the payroll tax cut would benefit 39,000 businesses and would could into effect from July 1.
"We are about cutting taxes where we can responsibly afford to do so, and we particularly want to cut business taxes so we can create more jobs here in Victoria."
The state's payroll tax will be cut to 4.85 per cent in a move the state government says will save Victorian employers more than $234 million over the next four years.
Dr Napthine made the budget announcement on Tuesday morning, and said the 0.05 percentage point cut was good news for business.
"This is genuinely about building a better Victoria by making our businesses more competitive, more able to grow and develop and better able to employ more Victorians."
Dr Napthine said the budget, which will be unveiled on Tuesday afternoon, would include "job creating, productivity boosting infrastructure".
There will also be "significant" investments in health, education, community safety and disability services, he said.
With Henrietta Cook